What is one source of funding for savings associations?

Savings associations primarily rely on time and savings deposits as a significant source of funding. These deposits represent money that customers place in the institution for a specified period or on-demand. Time deposits typically pay a higher interest rate than regular savings accounts, incentivizing customers to keep their money with the savings association for a longer duration. This accumulation of deposits allows savings associations to use these funds to finance home loans and other types of credit, thereby fulfilling their role in promoting home ownership and community development.

While corporate bonds, investment stocks, and non-profit donations can serve as sources of funding for various financial institutions or organizations, they are not fundamental to the operational model of savings associations. Corporate bonds and investment stocks are more aligned with investment strategies rather than core funding. Non-profit donations usually pertain to philanthropic organizations and do not fit within the typical financial structure of savings associations, which focus on deposit-taking and loan-making activities. Thus, time and savings deposits stand out as the primary and traditional source of funding for these institutions.